Harris Corp

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HRS : NYSE : Technology
$111.13 | %
Today's Range: 0.0 - 0.0
Avg. Daily Volume: 769600.0
03/29/17 - 4:01 PM ET

Financial Analysis


HARRIS CORP's gross profit margin for the second quarter of its fiscal year 2017 has increased when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. HARRIS CORP has weak liquidity. Currently, the Quick Ratio is 0.68 which shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 2.89% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)1700.01748.0
EBITDA ($mil)368.0370.0
EBIT ($mil)299.0298.0
Net Income ($mil)177.0-152.0


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)361.0552.0
Total Assets ($mil)11618.012097.0
Total Debt ($mil)4400.05026.0
Equity ($mil)3157.03251.0


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin37.1235.24
EBITDA Margin21.6421.16
Operating Margin17.5917.05
Sales Turnover0.620.51
Return on Assets5.720.54
Return on Equity20.7712.68
Debt Q2 FY17 Q2 FY16
Current Ratio1.571.33
Debt/Capital0.580.61
Interest Expense44.045.0
Interest Coverage6.86.62


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)124.28124.41
Div / share0.530.5
EPS1.331.58
Book value / share25.426.13
Institutional Own % n/a n/a
Avg Daily Volume742193.0719732.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 40.97 for the Communications Equipment industry and a discount compared to the S&P 500 average of 26.33. For additional comparison, its price-to-book ratio of 4.39 indicates a premium versus the S&P 500 average of 2.93 and a premium versus the industry average of 3.45. The price-to-sales ratio is below the S&P 500 average and is well below the industry average, indicating a discount. The valuation analysis reveals that, HARRIS CORP seems to be trading at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
HRS 21.34 Peers 40.97   HRS 16.69 Peers 17.74

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

HRS is trading at a significant discount to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

HRS is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
HRS 18.27 Peers 19.16   HRS 0.21 Peers 1.01

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

HRS is trading at a valuation on par with its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

HRS trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
HRS 4.39 Peers 3.45   HRS 51.74 Peers 5.61

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

HRS is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

HRS is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
HRS 1.93 Peers 3.31   HRS 16.37 Peers 21.16

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

HRS is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

HRS trails its peers on the basis of sales growth

 

 

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